Car Insurance Premiums
Car Insurance is a grudge purchase—we know we need it but we hate spending money on it. We therefore try to get it dirt cheap without considering if we are sufficiently covered.

A recent survey conducted on the Internet * found that 18% of the respondents said they simply can’t afford to pay for insurance anymore. While 38% said that they shop around for cheaper insurance only 13% said they negotiate a lower premium with their insurance company.

Having no car insurance is playing a very dangerous game that could ruin you financially, so before you go that route try to negotiate a lower premium with your insurer. Negotiation is a skill, a skill anyone can learn. Knowledge is the key to negotiation so arm yourself with knowledge; then you will be negotiating from a position of strength.

Carefully study your policy document, are you covered sufficiently? Do you need to keep your car radio covered? If the excess is a R1 000 and the radio is only worth R500, take it off your policy. If you took out your policy years ago, your car is probably worth a lot less at present, yet you are still paying a premium based on the original cover. In most cases insurances companies will refund you at the market value of your car should it be stolen or written off, so you should only pay car insurance based on the current market value of your vehicle.

Find out from a reputable car dealer what the market value of your car is at present. If you drive a rather old car you may even consider changing your insurance from comprehensive cover to third party, fire and theft. This will bring about a nice reduction in your premium. But make sure that it is in your best interest to do so.

Armed with this knowledge your next step in the negotiating process is to shop around. Get at least three different quotes from companies other than your existing insurance company. Give all the information required, 100% accurately. Saying that your car is kept in a locked garage overnight when it is not, to lower the insurance premium, can result in the company refusing to pay out should you have to claim.

The best place to do your research and obtain your quotes is on the Internet. Every insurance company, broker and agent has a website nowadays. Here you can find all the information you need as well as an online quotation request for you to complete.

If you are really pressed for time you can make use of, what is called aggregator sites. You will only need to complete the information once and will receive a number of quotes for your car insurance. You can also phone around for quotes, or if you have an insurance broker ask him/her to get quotes for you.

Once you have all the information and your quotes you approach your insurance company and ask them to review your insurance premium. Give them any new information they may not have, like the current book value of your car, or maybe you installed a new alarm system.

You negotiate, you tell them that you have obtained quotes from other companies and that you will move your business if they do not better, or at least, match your best quote.

Remember, you are talking from a position of strength. There is intense competition in the insurance market out there. With the introduction of online quotes the competition has increased even more.

The aim of your negotiation is not to move your insurance to another provider but to get the best deal from your existing insurer, if, of cause you are happy with their service and prefer to stay with them. If they are not prepared to lower your premiums you should move, but only after carefully considering all your options and making sure that you are still sufficiently covered.

If you can't go around it, over it, or through it, you had better negotiate with it. Ashleigh Brilliant

*References: Survey conducted by justmoney.co.za, Paul Beadle, M.D.